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Saturday, June 7, 2014

Can they do this?

Just checked my Union Plus account to make sure a payment posted and happened to notice that my credit limit had been raised ... $5,000!!

I do not remember receiving any notice of this change and, frankly, am irked that they did this. I checked my last statement and there was nothing there about raising the limit.

In fact, I have received several offers lately from other cards to have my limit raised and have ignored them. And while I would never deliberately agree to it, I'm tempted to just leave it as is and go on with my life. We don't use the card anymore - I'm not even sure we still have the actual card. The higher limit would, I imagine, be good for the credit score as it would lower the debt to credit ratio.

I don't know. Mostly it reminds me how much I hate credit cards and the game the companies play with consumers. I cannot wait until the day when I no longer have a credit card balance!!

10 comments:

If you don't have the card anymore I'd be tempted to close it out, but then I have absolutely NO understanding of how credit scores are worked out in the U.S. And yes, they can raise your limit. The two cards I had in the past would have annual increases without asking me. Got rid of them.

Annoying little devils, aren't they? Credit scores in the U.S. are a species of their very own and, unfortunately, have a great impact on many aspects of our financial lives. Prospective employers sometimes take a peek and base their hiring on what they see - Big Brother is alive and well here!

They CAN raise your limit. But you can call them and ask them not to over a simple phone call. I learned that the hard way too: my BOA was raised from 2k to 4k over 2 raises; my Discover IT card went from 3k to 5.2k in also 2 raises.

As far as how it affects your credit... if you have a lot of installment payments, yeah, it helps your debt-limit ratio. The lower the ratio, the better. I have no installment loans other than my car ($167/mo), but I have a credit limit of over 12k. I will eventually trim it down to size because I don't need the credit help from having a lot of available money, but it helped a lot at the beginning. (I wouldn't get rid of the cards, especially if they're one of your oldest cards-- if you're uncomfortable with the increase, call them up, reduce the limit and tell them not to auto raise again).

That's what I was thinking. That I will just leave it alone just for the effect on the credit score. I think a couple years ago it would have been a temptation having the available credit, but the mindset is different now and I don't worry about us running it up.

If you really won't use the card then no harm in leaving it. But be really realistic with yourself about that. They changed the law in Ireland a few years before I left so that automatically raising the limit was no longer allowed but by that time my first credit card, which had started with a limit of, I think, 500 had gone up to 12,500. At the time that would have been more than enough to buy a nice car! If I hadn't already between one thing and another and dribs and drabs, already used it nearly up to that limit! Ridiculous really. As long as you made slightly over minimum payments but also kept using nearly up to your limit, they automatically increased your limit every couple of months. And if you rang up to get it reduced back down you were told that doing so could affect attempts to get credit in the future. The cheek of them!It might be a good idea to at least phone them to prevent any future automatic increases, too.